Roku Return On Equity vs. Profit Margin
| R35 Stock | EUR 64.32 0.14 0.22% |
For Roku profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Roku to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Roku Inc utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Roku's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Roku Inc over time as well as its relative position and ranking within its peers.
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Roku Inc Profit Margin vs. Return On Equity Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Roku's current stock value. Our valuation model uses many indicators to compare Roku value to that of its competitors to determine the firm's financial worth. Roku Inc is currently regarded as top stock in return on equity category among its peers. It also is currently regarded as top stock in profit margin category among its peers . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Roku's earnings, one of the primary drivers of an investment's value.Roku Profit Margin vs. Return On Equity
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
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| = | -0.18 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Profit Margin measures overall efficiency of a company and shows its ability to withstand competition as well as defend against adverse conditions such as rising costs, falling prices, decline in sales or management distress. Profit margin tells investors how well the company executes on its overall pricing strategies as well as how effective the company in controlling its costs.
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| = | (0.16) % |
In a nutshell, Profit Margin indicator shows the amount of money the company makes from total sales or revenue. It can provide a good insight into companies in the same sector, as well as help to identify trends of a company from year to year.
Roku Profit Margin Comparison
Roku is currently under evaluation in profit margin category among its peers.
Roku Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Roku, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Roku will eventually generate negative long term returns. The profitability progress is the general direction of Roku's change in net profit over the period of time. It can combine multiple indicators of Roku, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Its platform allows users to discover and access various movies and TV episodes, as well as live sports, music, news, and others. The company was founded in 2002 and is headquartered in Los Gatos, California. ROKU INC operates under Pay TV classification in Germany and is traded on Frankfurt Stock Exchange. It employs 1111 people.
Roku Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Roku. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Roku position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Roku's important profitability drivers and their relationship over time.
Use Roku in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Roku position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Roku will appreciate offsetting losses from the drop in the long position's value.Roku Pair Trading
Roku Inc Pair Trading Analysis
The ability to find closely correlated positions to Roku could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Roku when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Roku - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Roku Inc to buy it.
The correlation of Roku is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Roku moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Roku Inc moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Roku can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Roku position
In addition to having Roku in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Wholesale Thematic Idea Now
Wholesale
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Wholesale theme has 61 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Wholesale Theme or any other thematic opportunities.
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Additional Information and Resources on Investing in Roku Stock
When determining whether Roku Inc is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Roku Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Roku Inc Stock. Highlighted below are key reports to facilitate an investment decision about Roku Inc Stock:Check out Your Equity Center. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
To fully project Roku's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Roku Inc at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Roku's income statement, its balance sheet, and the statement of cash flows.